House prices in Los Angeles and Orange counties rose in November at the slowest rate since the last housing slump ended in 2012, according to a new housing report.
Prices in the Inland Empire were up by the smallest margin just over three years.
The CoreLogic Home Price Index — the third key housing report for November — shows Los Angeles house prices were up 5.3%, the smallest margin since August 2012. Orange County’s gain measured 3.3%, the smallest margin since July 2012.
And prices were up 5.2% in the Inland Empire, the smallest gain since July 2015.
“The rise in mortgage rates has dampened buyer demand and slowed home-price growth,” said CoreLogic Chief Economist Frank Nothaft.
“Interest rates for new 30-year fixed-rate loans averaged 4.9% during November, the highest monthly average since February 2011,” Nothaft added. “Home sellers are responding by lowering their asking price, which is reflected in the slowing growth of the CoreLogic Home Price Index.”
The Southern California slowdown is part of a national trend. House prices increased nationally by 5.1% from November 2017. California prices increased 5%.
The HPI confirms data released earlier by CoreLogic and the California Association of Realtors. The earlier reports were based on the median prices, or prices in the middle of all sales.
The CoreLogic HPI uses “same-home” sales comparisons, a methodology similar to the respected SP Case Shiller index. Both indexes are considered a better measure of actual home values since they weed out fluctuations due to changes in the mix of homes sold.
CoreLogic predicted home prices will continue rising through November, albeit at a slower pace. Nationally, prices are expected to increase 4.8% by November 2019.
If December’s stock market volatility continues, however, that could change the outlook, said CoreLogic CEO Frank Martell.
“If recent declines in the stock market shake consumer confidence in the national economy, we may see homeowners’ perception of home value change and a subsequent buyers’ market emerge in 2019,” Martell said.
Tribune Content Agency